Question
1. The accountant at EZ Toys, Inc. is analyzing the production and cost data for its Trucks Division. For October, the actual results and the
1. The accountant at EZ Toys, Inc. is analyzing the production and cost data for its Trucks Division. For October, the actual results and the master budget data are presented below.
Actual results |
|
| Budget data |
|
10,000 trucks produced and sold |
| 12,000 trucks planned |
| |
Unit selling price | $15 |
| Unit selling price | $14 |
Variable costs: |
|
| Unit variable cost: |
|
Direct materials | $52,800 |
| Direct materials | $5 |
Direct labor | 51,000 |
| Direct labor | 4 |
Variable overhead | 23,000 |
| Variable overhead | 2 |
Total variable costs | $126,800 |
| Total unit variable costs | $11 |
Fixed overhead | $9,000 |
| Fixed overhead | $9,600 |
Calculate the actual, flexible budget and static budget income statements. Label the total variance due to cost control and due to activity/volume.
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